The quiet lull of FX dealing was ruptured today in morning London trade when the PM May office announced that it will make a statement at 11:15 local time. No specifics were given as to the nature of the announcement but traders reacted quickly selling the pound down to 1.2520 from 1.2600 within a matter of minutes. There was some speculation that Ms. May may call an early snap election, but her office quickly quashed those rumors.

For now cable remained above the 1.2500 mark but the pair was sure to see more volatility once the news is released.

The dollar remains under pressure as US yields have compressed significantly over the past week, driven lower by disappointing economic data, geopolitical tensions with North Korea and legislative chaos in Washington DC. With little evidence on the horizon that any of these problems will be solved soon, the greenback could remain depressed for the rest of the week, with short still targeting the 108.00 figure as their initial target.

Meanwhile in Australia, the Reserve Bank of Australia minutes cast a dour note on Asian session trade, as the central bank expressed concerns about the labor market conditions in the country. Although Australian monetary authorities acknowledged the recent improvement in the headline numbers, they noted that pick up in job has not resulted in increase in household consumption – a fact that clearly worried policy makers. The central bank even dropped, “Looking forward, year-ended growth was expected to pick up gradually to be above its potential rate over the forecast period” statement, signaling that it was concerned about growth going forward.

The minutes weighed on the Aussie which drifted lower all night long falling to a low of .7538 in early London dealing after being above the .7600 figure yesterday. It remains to be seen if the RBA worries are simply a short term phenomenon that will be assuaged by the recent blowout labor data numbers, or whether this cautious attitude will persist for the rest of the year. For now the market sees the central bank as firmly neutral, with little chance of changing its posture anytime soon and that should cap any rally in AUDUSD to the .7600 figure for the foreseeable future.

In North America today, the docket carries only second tier data with Housing starts, Building permits and Industrial Production on the calendar. Nevertheless, the reports could have impact on dealing, especially if they miss expectations and confirm the recent market consensus that US growth is stalling.